Record profits and a return to dividend payments from British Airways helped put the London market on the front foot today.
Although the airline has contended with spiralling oil costs and the botched opening of Heathrow’s Terminal 5, the stock was cheered 4% by profits of £883m (€1.1bn) and the first shareholder payout since 2001.
The wider FTSE 100 Index closed 52.5 points higher at 6304.3, although the larger gains seen earlier in the session were tempered by early losses in US markets.
Wall Street wrestled with better than expected housing data but gloomy consumer confidence readings, while traders were also unsettled by oil reaching a new peak of almost US$128 a barrel.
BA’s profits triggered bonuses for all staff except chief executive Willie Walsh. He will not be benefiting after he surrendered his payout due to the Terminal 5 issues. Shares in the carrier were among the Footsie’s top risers, up 9p at 233p.
The airline was surpassed by British Energy, which gained more than 5% after it revealed it had received a range of proposals from several parties. Shares were 35.5p stronger at 715.5p, reversing losses seen in recent days amid fears that EDF would win the company with a proposal worth less than 700p a share.
Thomas Cook and TUI Travel shared in BA’s recovery, with the travel firms ahead 7.5p at 263.25p and 4.75p at 253.75p respectively despite the high oil prices.
In the cheerful mood several retailers were also on stronger ground, with Next adding 46p to 1285p, and Argos owner Home Retail Group 8.25p up at 260.5p.
Marks & Spencer, which is due to publish results on Tuesday, lifted 13.25p to 415p, a rise of more than 3%.
Among the Footsie shares in negative territory, engine maker Rolls-Royce fell 10.75p to 439.25p after it was reported that Airbus was developing a biofuel that could power a third of the world’s aircraft by 2030.
Sainsbury’s fell 4.75p to 372.76p as more analysts downgraded the supermarket in the wake of its results earlier this week. While the headline figures showed a 28% rise in annual profits, the City is clearly concerned about the company’s ability to grow sales and earnings in a tougher climate.
In the FTSE 250 Index, Ladbrokes shares were nearly 2% or 5p higher at 315p after its figures were boosted by demand for football bets on the Premier League title race and the three teams in the Champions League semi-finals.
However, moneysupermarket.com set the pace in the second tier after Cazenove issued a positive note on the price comparison service. Shares rose 8.25p to 127.25p.
Property website Rightmove was a faller however after Halifax Bank of Scotland sold its 13% stake in the firm. Shares fell 6.75p to 378.75p.
The biggest Footsie risers were British Energy up 35.5p at 715.5p, London Stock Exchange ahead 55p at 1143p, British Airways up 9p at 233p and Icap up 24p at 659p.
The biggest Footsie fallers were Royal Bank of Scotland down 9.5p at 266.5p, Rolls-Royce down 10.75p at 439.25p, Tate & Lyle off 7p at 499p and FirstGroup down 7.5p at 546.5p.